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NAME: PER: CRASH COURSE US HISTORY Episode #23: Industrial RevolutionLength: 12:31”NOTES:Industrial Revolution- the US will become the most industrialized nation on earth. Civil war improved finance situation creating a national currency and spurred industrialization by giving massive contracts in arms and clothing contracts. It also improved communication and gave birth to the transcontinental railway. It also boosted the telegraph. Railway Act of 1862 which increased productivity and efficiency. America’s economic growth Geography, demography and Law GDLGeographically the US had all the resources coal, iron and oil. We will have water that will be replaced by coal. Demography -Americans population grew from 40 million in 1870 to 76 million in 1900 and 1/3 of that growth is due to immigration. That is god for economies. They flooded to new cities As America shifted from being an Agrarian rural to industrial urban one. NY city was the center of commerce. The industrial heartland was in the Great Lakes region. The Law, the constitution and commerce clause made it a single area of commerce like a giant customs union. The supreme court interpreted the laws in a very business like way. The constitution also protects patents which encourages invention and innovation. The American government played a role as it put up high tariffs on steel and giving massive land grants to Railroads and putting Indians on reservations. Foreigners played an important role as they invested their capital. The US was seen by Europeans as a developed economy. America offered a higher return than Europe. In 1880 a majority of the workforce worked in non-farming jobs. By 1890 2/3 of Americans worked for wages rather than farming or owning their own businesses. By 1913 the US produced 1/3 of the industrial output for the world. Railroads one of the keys to Industrial success as it increased commerce and integrated American market which allowed national brands to emerge like Ivory soap. Railroads changed and improved our economy in less obvious ways too. They also improved our economy by giving us time zones to make transport more standard. Richard Warren turned a 50.00 investment in watches into a mail order empire. It made his partner Roebuck very wealthy as they began shipping things from as small as a watch to houses around the nation. Railroads were also the first modern corporations. They needed to invent organizational methods with supervisors. Railroads were also the first publicly traded corporations as they sold shares in the company as the public bought and sold shares. They were the first captains of industry. Vanderbilt, Carnegie, and Leland Stanford. The Railroad business was about the partnership with the national government as it wouldn’t have existed without congressional legislation, government land grants and bond issues. Muckraker- Ida Tarbell was a great opponent of Capitalism. Industrial Capitalist are considered the greatest heros and villans of the era. They were also known as Robber Barons. They became very wealthy as their methods were unscrupulous. The first of the great captains of industry- Cornelius Vanderbilt made a fortune in transportation through ferrys, and shipping and trains. Rockefeller- became the richest man in the world the key to his success was to buy up so many rivals that by the 1880’s standard oil controlled 90% of oil production. If you had one of the 20 cars in the world you were mad. The robber barons formed pools and trusts to protect themselves. The problem with competition is that over time it reduces both prices and profit margins. Which makes it difficult to be super rich. Firms would vertically purchase other parts of the same industry. (vertical integration) From raw materials to production to distribution) Horizontal integration is when big firms bought up small ones. Standard oil is a great example. Standard oil was so big that the supreme court divided it up to 12 other companies. Over time they would become exxon mobile. JP Morgan – was giant of finance left 68 million. Workers – the benefits of economic growth were shared a smidge unevenly. Prices did eventually drop and raised the standard of living for the average worker. Lots of job insecurity booms and busts meant depression in the 1870’s and 1890’s. Workers would work 60 hours a week with no pensions or injury compensation. The US had the highest rate of Industrial injuries. 35k people per year died on the job. Unions were created and were mostly local. The first union was the knights of labor which grew from 9 members in 1870 to 728,000 by 1884.The Knights of labor admitted unskilled workers women and black workers. It was damaged by Haymarket Riot of 1886. A bomb killed 7 police officers as the police killed 4 people and 7 anarchists were convicted. The public still associated them with violence. By 1902 they had zero. The American Federation of Labor as Samuel L Gompers were moderate and focused on bread and butter issues like pay, hours and safety. Founded in 1886 the same year as Riot and had 250k members by 1892. Social Darwinism: they argued that survival of the fittest should be applied to people and that corporations were like people and that would have nothing to fear about monopolies. It assured the rich were poor because of some evolutionary flaw to allow tycoons to sleep at night. Unions continued to grow and sometimes violently. Strikes- Homestead Steel strike and the Pullamn Rail strike as strikers were killed and property was destroyed. We had 5 times as many unionized workers as Germany. Unions wanted the US to imagine freedom more broadly which meant we needed a more equal economic system. QUIZ QUESTIONS1. How did the Civil War help create a better financial situation leading to the Industrial Revolution? 2. How did Geography, Demography and Law help America grow industrially? 3. What role did the American government play in all of this development? 4. How were the Railroads the key to all of this economic development? 5. Name one of the Robber barons and how they contributed to Industrial Growth?6. Why were unions created? 7. Who did Social Darwinism help and why? DISCUSSION QUESTIONS: 1. What was the most important Industrial occurrence from this episode? 2. How was the Railroad tied to the Robber Barons? 3. How were the Knights of Labor destroyed by the Haymarket Riot? What will this lead to next? ................
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